**GAO-05-656**                      Published: Sep 22, 2005. Publicly Released: Oct 12, 2005.                  

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## Highlights

In fiscal year 2004, the Centers for Medicare & Medicaid Services (CMS) estimated that Medicare improperly paid $900 million for durable medical equipment, prosthetics, orthotics, and supplies--in part due to fraud by suppliers. To deter such fraud, CMS contracts with the National Supplier Clearinghouse (NSC) to verify that suppliers meet 21 standards before they can bill Medicare. NSC verifies adherence to the standards through on-site inspections and document reviews. Recent prosecutions of fraudulent suppliers suggest that there may be weaknesses in NSC's efforts to screen suppliers or in the standards. In this report, GAO evaluated: 1) NSC's efforts to verify suppliers' compliance with the 21 standards, 2) the adequacy of the standards to screen suppliers, and 3) CMS's oversight of NSC's efforts.

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## Topics

Health Care

FraudInspectionLicensesMedical equipmentMedical suppliesMedicareOverpaymentsStandardsStrategic planningProgram beneficiaries